Federal law enforcement seized more than $3.6 billion in stolen cryptocurrency directly linked to the 2016 hack of virtual currency exchange Bitfinex, and have arrested a husband and wife from New York allegedly connected to the stolen bitcoins.

Ilya Lichtenstein, 34, and his wife, Heather Morgan, 31, were arrested today in Manhattan for an alleged conspiracy to launder the stolen bitcoins. According to court documents, Lichtenstein and Morgan allegedly conspired to launder 119,754 bitcoins stolen from Bitfinex’s platform after a hacker breached Bitfinex’s systems and initiated more than 2,000 unauthorized transactions. Those unauthorized transactions sent the stolen bitcoin to a digital wallet belonging to Lichtenstein, the Justice Department alleged.

In 2016, the bitcoins were worth about $71 million. Currently, they’re worth nearly $4.5 billion. Federal officials said they recovered about 94,000 of the stolen bitcoins, worth more than $3.6 billion.

“Today’s arrests, and the department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals,” said Deputy Attorney General Lisa O. Monaco in a press release.

“In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions,” she said. “Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter what form it takes.”

While cryptocurrency is an expanding facet of the U.S. financial system, digital currency heists could undermine confidence in the currency.

“Financial crime strikes at the core of our national and economic security. With a hack of this magnitude, public and private sector collaboration are crucial to ensure continued consumer confidence in our financial system,” said Steve Francis, acting executive associate director of Homeland Security Investigations – the primary investigative unit of the Department of Homeland Security.

U.S. Attorney Matthew M. Graves for the District of Columbia said that the Justice Department has vowed to confront these threats utilizing 21st-century investigative techniques to recover the stolen digital funds and hold the perpetrators accountable.

The New York couple faces charges of conspiracy to commit money laundering and conspiracy to defraud the U.S., totaling a maximum sentence of 25 years in prison. Lichtenstein and Morgan made their initial appearances in Federal court in Manhattan today.

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Lisbeth Perez
Lisbeth Perez
Lisbeth Perez is a MeriTalk Senior Technology Reporter covering the intersection of government and technology.